Chinese Prime Minister Li Keqiang - Photo: Privacy.

JAKARTA (TheInsiderStories) – Last week, Chinese Prime Minister Li Keqiang announced a massive economic reform step to drive the economic growth. He said, the government would cancel ownership control of foreign companies investing in the financial sector by 2020, a year ahead of the initial schedule of 2021.

While in India, the government has launched a plan to increase foreign investment and fulfill its ambitious target to grow into an economy of US$5 trillion by 2025, especially in the infrastructure sector, digital economy, in job creation.

The government also pledged to provide tax breaks and other benefits to encourage new companies, which helped generate jobs needed by India, because the unemployment rate jumped to a 45-year high.

Moreover, Premier Li said China will also reduce restrictions on market access for foreign investors in value-added telecommunications services and the transportation sector.

Affirming China’ commitment to free trade and multilateralism, Li said, “China wants to work with other countries to direct globalization in the right direction.”

To create a better environment for foreign investors, PM Li promised that China would be more open to the world and simplify more regulations by the end of this year.

Furthermore, China said on Sunday (07/07), that it would relax restrictions on foreign investment in the Chinese market in areas including oil and gas exploration, and the service sector and it would consider introducing a series of tax cuts to encourage economic growth.

Although Chinese President Xi Jinping and his US counterpart’ Donald Trump agreed to restart trade negotiations after met in G20 Summit di Japan, the final agreement is not expected to be achieved in the near future.

So far, PM Li announced that Beijing would push to create an equivalent playing field in the country for all companies, including companies from the US and other countries that have long complained that China is preferential treatment for home businesses.

For example, how China plans nearly 2 trillion yuan (US$300 billion) in taxes and fees must be applied to all three business categories.

PM Li added, with business executives and journalists that foreign investment companies registered in China could also benefit from government measures to support local innovation. If found, they can file a complaint.

In the forum, Li stated that the country was on the right track to reach the target of economic growth of between 6 percent and 6.5 percent for this year. That will still fall below the level of 6.6 percent last year, which is the slowest growth since 1990.

In the economic side, the economic policy with extreme stimulus despite pressure on growth. Both are potential actions that are of concern to the market and will have a significant fear of an economic downturn among Beijing decision-makers, he said.

The plan to open access to foreign investment is also in line with the country’ intention to attract as many as possible Indian engineers, who are currently having difficulty obtaining visas to return to work in Silicon Valley.

With the arrival of Indian engineers, they can be employed in the vital sectors of the Chinese economy, especially in the field of digital technology. The development of China’ digital technology has become the world’ number one, just behind US companies such as Google and Apple. In China, there are Alibaba, Tencent, Huawei, etc.

With that, the opportunity to get Indian professional talent is increasingly open, even though in China the salary is paid less than US companies in Silicon Valley.

But the plan will be closed if the Indian government calls back its professional staff to drive economic growth, as seen from the country’s government ambitious target to grow into an economy of $5 trillion by 2025, especially in the infrastructure sector, digital economy, in job creation.

The government also pledged to provide tax breaks and other benefits to encourage new companies, which helped generate jobs needed by India, because the unemployment rate jumped to a 45-year high.

Despite the government has not provided a roadmap for liberalizing strict labor and land laws, which have become a stumbling block in India’s efforts to attract investors, PM Narendra Modi is widely expected to lead them to be more courageous in reforming during his second term.

Thus, we don’t yet know for sure where these India’sengineer will anchor, but if the Indian government dares to pay those with high income, so likely they will be more willing to serve their country.

Written by Staff Editor, Email: theinsiderstories@gmail.com